(EN) GTHTSVN_Sector Update_Consumer Sector Update 1H2026_21.08.2026

Against the backdrop of heightened geopolitical tensions in the Middle East, Vietnam maintained an impressive economic growth momentum in 1H2026, with GDP growing 8.18% YoY, while the consumer sector made a positive contribution to overall growth. Specifically, domestic consumption continued to improve in 1H2026, with total retail sales of goods and consumer services revenue increasing 12.9% YoY, including retail sales of goods up 12.5% YoY. However, the recovery in purchasing power remained uneven, with spending concentrated more on essential goods and reasonably priced products.

Modern retail channels continued to gain market share from traditional channels, particularly in FMCG and food, supported by advantages in pricing, product assortment, and service quality. WCM and BHX maintained a rapid store expansion pace, while revenue per store continued to improve, supporting their growth outlook in 2H2026.

Essential consumer segments showed clear divergence. The dairy industry continued to recover from a low base, supported by improving volumes and a shift toward nutritional products. Meanwhile, the livestock industry faced pressure from higher input costs and declining hog prices, weighing on profit margins and resulting in a less favorable earnings outlook. The beer industry is gradually adapting to pressure from alcohol-control policies and weak consumer demand. A modest recovery was supported by easing malt prices and the World Cup, although the recovery remains limited.

Pharmaceutical retail remained in an expansion cycle, with Long Chau continuing to lead the market, while An Khang and Pharmacity began accelerating store openings. However, intensifying competition could drive higher promotional and operating expenses, putting pressure on profit margins.

Non-essential consumer segments were broadly saturated and lacked strong growth drivers, particularly ICT and consumer electronics, which continued to face pressure from e-commerce channels. Leading players are still capable of achieving modest short-term growth, supported by their market share advantages, cross-selling opportunities, and stronger bargaining power with suppliers. Jewelry retail continued to face significant challenges as consumer confidence deteriorated sharply and raw material prices remained volatile.

Overall, 2H2026 is expected to mark a clearer recovery phase for the consumer sector, although growth will remain highly differentiated across segments. We favor companies with the ability to expand their scale, gain market share, and improve operational efficiency, while key risks remain input cost pressures, promotional competition, and an uneven recovery in consumer purchasing power.